Apple looks for big screen boost as iPhone 6 hits China

A woman counts Hong Kong dollar banknotes as people resell Apple iPhones across from the company’s Causeway Bay store during the sales launch of the iPhone 6 and iPhone 6 Plus in Hong Kong, China

Apple’s large screen iPhone 6 Plus is finally available in the world’s biggest smartphone market and Chinese consumers don’t have to resort to smugglers.
The new device went on sale Friday in China, almost a month after their global debut. The 4.7-inch iPhone 6 starts at 5,288 yuan (USD863) through Apple’s China outlets which compares with $649 for the same model without a contract on its U.S. website.
Strong demand, especially for the 5.5-inch iPhone 6 Plus, saw Chinese consumers pay black market vendors almost double the Hong Kong price for phones brought illegally across the border after its global release. While the debut comes as China’s wireless carriers cut subsidies on devices, the new Apple phones will outsell previous models, said Bryan Wang, China country manager for Forrester Research.
“The large screen iPhones are going to sell better in China for the first weekend than last year’s iPhone 5s, but may not be multiple folds,” Wang said.
As many as 20 million consumers registered to buy the new devices through various channels, according to a report on Tencent Holdings Ltd.’s Tech.qq.com website. Usually about 10 percent to 15 percent of registrations result in sales, implying sales between 2 million and 3 million units, Wang said.
About 150 people lined up at Apple’s store in China Central Place in eastern Beijing Friday to pick up devices they pre-ordered as staff in blue shirts clapped and chanted “iPhone 6” in Mandarin.
Among the first was 27-year-old doctoral candidate An Le, who has used Apple since getting an iPhone 4s and bought the 6 Plus. He had been waiting for Apple to release a larger screen phone to rival devices from Samsung.
“Samsung has already had large screens for years, and I’ve been waiting for Apple to catch up,” An said. “Now that it’s finally here I really want to give it a try.”
Apple and other high-end smartphone makers are facing changes in how China’s wireless carriers sell devices as operators move to lower the amount they spend on subsidizing new devices. China Mobile, the world’s largest carrier, is taking steps toward eliminating $2 billion in smartphone subsidies.
At the carrier’s store in Beijing’s Wangfujing shopping street, staff explain there are no unique packaging or pricing plans for the iPhone 6 and no subsidies for any smartphones on display.
Instead, customers are offered discounts on calling plans depending on their monthly spending. On the most expensive plan, the total discount adds up to 3,264 yuan over two years, or about 62 percent of the cheapest iPhone 6.
Apple is also rolling out the new iPhones in India and Monaco and the phones will reach an additional 36 countries this month. By the end of October, the devices will be available in 69 countries and on pace to reach 115 countries by year’s end, Apple said in a statement.
Still, none of those markets can compare to China, where Apple got $5.9 billion of sales in the three months ended June 28, or about 16 percent of the company’s total revenue. The China region for which the company discloses sales includes Taiwan and Hong Kong.
Fever for the largest devices had buyers in Beijing last month paying 12,000 yuan for the 128 gigabyte iPhone 6 Plus, or 87 percent more than the Hong Kong list price. That model cost 7,788 yuan at Apple from Friday, according to its China website.
“The outlook for the iPhone 6 and 6 Plus seems positive in China,” said Tay Xiaohan, a Singapore-based analyst with International Data Corp. “Apple has always been a very popular brand with the Chinese, and with the demand for larger screen sized phones growing in China, we are not surprised to see the high number of pre-orders for iPhones in the market.” Bloomberg